Sovereign wealth funds and economic growth

Ermanno Affuso, Khandokar M. Istiak and Alex Sharland
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Khandokar M. Istiak: University of South Alabama
Alex Sharland: University of South Alabama

Journal of Asset Management, 2022, vol. 23, issue 3, No 2, 214 pages

Abstract: Abstract A synthetic control method in a comparative case study evaluates the potential effect of a sovereign wealth fund on the economic growth of a country. Trinidad and Tobago (T&T) is the focus of the case study. This is the first empirical research in the economic literature that attempts to evaluate the impact of a sovereign wealth fund on economic growth of an emerging economy. The results provide evidence that the fund contributed to a higher real per capita GDP of T&T by an estimate of $5104.57 (2010 US$) per year. The cumulative 30 years’ welfare impact of the fund is approximately $107,196 (2010 US$) per capita. Small island economies should consider implementing similar programs to foster economic growth.

Keywords: Economic development; Sovereign wealth funds; Synthetic control method; Small island developing states; Trinidad and Tobago (search for similar items in EconPapers)
JEL-codes: C54 E21 O11 (search for similar items in EconPapers)
Date: 2022
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DOI: 10.1057/s41260-022-00260-6

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